China's property management companies have started proactively terminating their relationships with homeowners. In the past, it was homeowners who wanted to get rid of property management firms; now it is the property managers themselves who are voluntarily walking away. Leading companies like Vanke Property and Poly Property would rather forfeit hundreds of millions in revenue than continue servicing large batches of residential communities.
In the first half of 2026, Onewo (formerly Vanke Property) exited 139 residential projects, representing an annual property fee scale of approximately 740 million yuan. This business looks lucrative on paper, but in reality it is merely a paper paradise. In practice, a single building often yields only a handful of actual payments. At the Shatingang New Community in Baiyun, Guangzhou, Poly Property publicly disclosed outstanding property fee debts exceeding 11.3 million yuan, with an average collection rate of only 26% in the first half of the year. The withdrawal date was pushed from September 14 to October 13, with no new property management company willing to take over. Among the 112 exit and planned exit projects monitored by CRIC Property Management in the first half of the year, nearly 80% were voluntary departures initiated by the property management companies themselves.
Why Are Chinese Homeowners Unwilling to Pay Property Fees?
When it comes to overdue property fees, most people's first reaction is that the service level of the property management does not match the fees charged. But reality is far less black and white.
At the Jinqiu Leyuan community in Xinzheng, Henan Province, there was once a company that homeowners called a "fairy-tale property management firm." It repaired fountains, picked up and dropped off children from school, and hired tutors to help with homework. Yet of the 1,550 occupied households, only just over a hundred paid their property fees. By the end of June this year, the property management company withdrew. With service taken to such lengths, why still no money collected?
Let us first look at how these fees are determined. In many communities, the initial property management company is selected by the developer, and the fee standards are presented to homeowners along with the purchase contract. When buying a home, people are busy looking at floor plans and scraping together down payments. Only after moving in do they start to examine closely: how much per square meter, what area is used for calculation, and what parking fees apply. If the food is bad, you can switch restaurants, but if you dislike the property management, several hundred households must collectively agree on how to replace it. A service that should be chosen by consumers becomes an arrangement that must be accepted upon moving in.
A former property manager interviewed by Renwu kept ledgers for over 100 households with overdue fees. Some people did not understand why they had to pay based on the area stated on the property certificate, including shared common areas, when they had already spent so much money buying the home and the property management did not even enter their apartments to mop floors. Others had their floor tiles cracked during earlier exterior renovation work, and with the old problem unresolved, they withheld their property fees. Corridor cleaning and equipment maintenance are public services, but what homeowners often want to buy is "when my home has a problem, you need to fix it." Water seepage in underground garages and unfulfilled amenities promised at handover—holes left by developers easily turn into arguments at the property management front desk.
A deeper reason for the unwillingness to pay is the high per capita home ownership rate. In a townhouse community in Sichuan, the occupancy rate is less than 30%, with a large number of homes being bare-shell units purchased by owners at high prices between 2020 and 2021. Previously, people hoped for appreciation, and property fees were just a minor item in holding costs. Now the homes sit empty, mortgages are still being paid, and property bills keep arriving—every month money must be spent on a home nobody lives in. For a 120-square-meter home at 3 yuan per square meter per month, that is 4,320 yuan per year. Homeowners who spend only a few days there each year and enjoy few services naturally are unwilling to pay.
Moreover, in the eyes of homeowners, the property management company clearly is not short of money. Elevator advertisements, parcel lockers, charging stations—advertising is visible everywhere. These revenues generated from homeowners' shared areas, after deducting reasonable costs, should belong to the homeowners collectively. But advertisements change daily while the account books remain unseen, prompting homeowners to ask: the property management makes money using our space, so why do they always claim to have no money?
An investigation by Jiancha Ribao noted that public revenues even include rent from communal buildings and residual value from the disposal of shared equipment after scrapping—far more complex than a single elevator advertising board. Homeowners can see these spaces being used for business, but may not know how much was collected, how much cost was deducted, and how much remains.
A more subtle psychology is at play: if everyone refuses to pay, the one who does pay appears foolish, and this sentiment spreads among neighbors. In a 2,500-household community in Chongqing reported by Renwu, during a mobilization against the property management, those who paid were called "suckers," and in the end only just over 400 households paid.
When money cannot be fully collected, expenses for cleaning, security, and elevator maintenance still occur as usual. If the property management company tries to maintain operations by raising fees, the first to pay more are often those who have been paying on time. Neighbors who have been delaying payment become even more reluctant as prices rise. A fee increase usually raises expectations of upgraded services: corridors mopped more frequently, more staff at the gate, faster repairs. But the extra money collected may merely fill the original shortfall, barely sustaining existing services. Those who pay on time, seeing neighbors who have delayed for years still entering the building and using the elevator as usual, can easily begin to hesitate. Those who owe save cash while enjoying the same services as those who pay, making rule-following seem like a disadvantage.
The Money Homeowners Save Turns into Trouble in the Building
When property fees cannot be collected, expenses do not disappear proportionally. Consider a community with 500 households, each 100 square meters, at 2.5 yuan per square meter per month. If fully collected, annual property fees would total 1.5 million yuan. But if the collection rate drops to half, actual receipts fall to just 750,000 yuan. With half the money missing, garbage still needs daily removal, gates still need staffing, and elevators still need regular maintenance. These expenses cannot easily be halved along with the collection rate.
China Merchants Property Operation's 2026 semi-annual report shows a gross profit margin of 10.58% for residential basic property management services. Out of every 100 yuan in revenue, after deducting direct service costs, only 10.6 yuan remains, which must also cover headquarters management and other expenses. Many communities adopt a lump-sum system: homeowners pay a fixed fee, the property management provides contractually agreed services, and the company bears profit or loss. As buildings age, water pumps, pipes, and access control systems gradually fail, and major equipment repairs and upgrades involve special maintenance funds. Homeowners become more confused: we pay property fees every year, so why is another sum needed to repair equipment?
After the property management withdraws, matters previously hidden in the bills will be laid out one by one before the homeowners. In a community in Nanping, Fujian, an elevator button panel broke, and repairs cost 480 yuan. Split among 170 households, that is less than 3 yuan each, yet only 40 people paid. An enthusiastic neighbor had to find a technician, negotiate the price, chase payments, and figure out how to recover the money advanced. To some extent, handling these troublesome matters on behalf of homeowners is also one of the core competencies of property management.
Companies Move Elsewhere to Make Money, Homeowners Stay Put
Property management companies can abandon unprofitable communities and take on contracts elsewhere. While Onewo was exiting projects in the first half of the year, it also signed 207 new residential projects, and its residential property service revenue still grew 6.5%. A-share listed company Nandu Property mentioned in its 2026 semi-annual report that proactively exiting some unprofitable projects drove an increase in gross profit margin. During the same period, the company's net profit excluding non-recurring items grew 11.04%.
The new business it takes on has also changed shape. Of the newly signed area by Nandu Property in the first half of the year, residential accounted for only 16.67%, while commercial, office, and urban services together exceeded 80%. Those residential projects with collection difficulties, aging facilities, and long-term losses are being removed from the company's books. Corporate and institutional clients have become new expansion priorities. China Merchants Property Operation's non-residential basic property management revenue in the first half was approximately 5.36 billion yuan, compared with approximately 2.17 billion yuan for residential. Cleaning at airports, order maintenance at hospitals, equipment repair in office buildings—all can become orders for property management companies.
Another A-share company, Xindazheng, has long served aviation, schools, public buildings, and other scenarios. In the first half of the year, revenue was 1.577 billion yuan, with net profit attributable to shareholders of approximately 72.42 million yuan—about 4.6% of revenue. Seemingly ordinary mopping, patrolling, and repairs can also support the business of a listed company. With institutional clients, property managers can negotiate contracts, service lists, and settlement arrangements around a single buyer, without having to chase hundreds of property fee payments door to door. The industry has begun directing resources toward projects that are easier to manage and more likely to yield collectible revenue.
Property management companies can change clients, but homeowners cannot easily change homes. Who finds repair technicians, who reviews quotations, who contacts waste removal companies, who coordinates with neighbors occupying public corridors? These matters are usually inconspicuous, and only after the property management withdraws does it become clear that each one requires someone to spend time, offend people, and take responsibility. The money is there, the equipment is there; what is missing is the consensus and organization to get things done. Losing property management means losses extend from services to order. Further down the line, these problems will enter the price of the home. When buyers come to view a property, walking from the community gate to the corridor and elevator already reveals whether anyone is maintaining the place. Piles of garbage, broken equipment, and public spaces arbitrarily occupied all become reasons to hesitate on a purchase and push for a lower price. What property management companies exit is a project with an unfavorable return; what ordinary people are left with is a home they must live in every day and may need to sell in the future.